SKECHERS Announces Second Quarter 2012 Financial Results

SKECHERS USA, Inc. (NYSE:SKX), a global leader in lifestyle footwear,
today announced financial results for the second quarter ended June 30,
2012.

Gross profit for the second quarter of 2012 was $171.3 million or 44.6 percent of net sales compared to $143.3 million or 33.0 percent of net sales for the second quarter of last year. Gross profit for the first six months of 2012 was $327.0 million or 44.5 percent of net sales versus $335.9 million or 36.9 percent of net sales for the first six months of 2011.

Robert Greenberg, SKECHERS chief executive officer, commented: "During the second quarter, SKECHERS celebrated its 20 th anniversary, which gave us the opportunity to reflect on our accomplishments over the last two decades. As we look ahead, each day, new line, and business channel presents not only new challenges, but also new opportunities for the Company. We have recently entered the performance running market and received “Most Innovative” awards from both Competitor and Women’s Running magazines for our first generation style. These are incredible achievements for our first performance style. We are supporting our Performance Division with the launch of new television and print campaigns, including the return of Mr. Quiggly, the French bulldog who starred in our Super Bowl commercial. We supported our kids’ and lifestyle brands with advertising this Spring, and will be back with a comprehensive targeted campaign for Back to School season. We are also looking forward to the July 31 DVD release of Twinkle Toes: The Movie, which features the namesake character of one of our most successful kids’ lines; the DVD will be available in our own stores as well as select major retailers nationwide. The enthusiasm for our product is being felt in our SKECHERS retail stores as our sales strengthen. The reaction has also been very positive to our Spring 2013 lifestyle and performance lines from our international distribution partners during our 20 th Anniversary Conference in June, as well as from our domestic accounts. With a consistent focus on delivering fresh styles, we believe we will continue to find new opportunities to grow our business in the United States as well as around the world.”

Mr. Weinberg added: “We are continuing on the path we set last year of cleaning up our inventory and bringing forward new and relevant product in the diverse categories our brand represents. We believe that we will continue to see sales improvements in the second half of 2012, including in our international business, which was adversely affected by the Euro exchange rate in the quarter, as well as toning sales during this same period last year. Sales are strong in our retail business, and we are looking forward to new lines being delivered this quarter in our stores as well as to third party retailers. Our buy meetings we held throughout July with our largest accounts indicate we are on track for continued growth and expansion of shelf space. With improved gross margins, inventory levels in line with our expected sales levels, continued attention to managing our expenses, and a strong balance sheet, we expect a stronger second half as we build momentum into 2013.”

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